What Does the Lower Petrol Price Mean for Consumers?
Last week we got the news that the petrol and diesel price will be lower as of Wednesday, 2 September 2015. The question everyone is asking, though, is if this will bring the consumer some respite during this difficult time in the South African economy.
How Much Lower Will the Diesel and Petrol Prices Be?
- 93 and 95 octane unleaded petrol will be 69c/l cheaper
- Petrol will cost R12.57 in Gauteng and R12.14 at the coast
- Diesel will drop by 54c/l for 0,05% sulphur fuel and 51c/l for 0,005% sulphur fuel
- Illuminating paraffin will decrease by 55c/l
- Wholesale illuminating paraffin will decrease by 74c/l
- Liquefied Petroleum Gas will decrease by 115c per kg
What Caused the Price of Fuel to Drop?
Even though the rand has not been performing well against the major currencies — even dipping briefly to R14 to the dollar — the lower petrol price can be attributed to the lower prices of Brent crude oil. During the review period the average price of Brent crude was $46.93, the Central Energy Fund reported on Friday 28 August.
Energy Minister Tina Joemat-Pettersson, however, also approved an increase of 4.6c/l in the retail margin to cater for the 9% salary increase of pump attendants and cashiers, Business Day reported.
Brace for Tough Times, Economists Warn
Economists like Dawie Roodt, however, warn that there are tough financial times ahead for South Africans. Neil Roets told Business Tech “consumers should be mindful that other economic indicators remain largely negative… it is belt tightening time for the storm that might hit us later this year, as economic growth is going to be way lower than predicted by the government”. He further added that the drought in much of the country will most likely lead to increased food prices.
Dawie Roodt also stated that it is unlikely that there will be another petrol price decrease next month if the rand remains at its current levels. “The outlook for consumers in South Africa is grim because of several factors”, he said and urged consumers to get rid of as much debt as possible and avoid new debt.
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Author: Carin Marais
Carin Marais writes web articles, guest and blog posts, and fiction. To contact Carin for articles and guest posts, or to read her work, go to her website, her blog Hersenskim or follow her on @CarinMarais.